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HomeMy WebLinkAbout03-117 - ADMIN Resolution - City Council - 2003/09/15CITY OF ST. LOUIS PARK, MINNESOTA RESOLUTION NO. 03-117 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ST. LOUIS PARK, MINNESOTA, AUTHORIZING THE ISSUANCE, SALE, AND DELIVERY OF ITS REVENUE REFUNDING BONDS FOR THE BENEFIT OF PARK NICOLLET HEALTH SERVICES, METHODIST HOSPITAL, PARK NICOLLET INSTITUTE, PARK NICOLLET CLINIC, AND PNMC HOLDINGS; PAYABLE SOLELY FROM REVENUES PLEDGED PURSUANT TO THE BOND INDENTURE; APPROVING THE FORM OF AND AUTHORIZING THE EXECUTION AND DELIVERY OF THE REVENUE REFUNDING BONDS AND RELATED DOCUMENTS; AND PROVIDING FOR THE SECURITY, RIGHTS, AND REMEDIES WITH RESPECT TO THE REVENUE REFUNDING BONDS WHEREAS, the City of St. Louis Park, Minnesota (the "City"), is a home rule city and political subdivision duly organized and existing under its Charter and the Constitution and laws of the State of Minnesota; and WHEREAS, pursuant to the Minnesota Statutes, Sections 469.152-469.165, as amended (the "Act"), the City is authorized to issue revenue bonds for the following purposes: (i) to finance, in whole or in part, the cost of the acquisition, construction, reconstruction, improvement, betterment or extension of a project, defined in the Act as including any properties, real or personal, used or useful in connection with a revenue producing enterpnse, whether or not operated for profit, engaged in providing health care services, including hospitals, nursing homes, and related medical facilities; and (ii) to refund, in whole or in part, bonds previously issued by the City under the authority of the Act and interest on such bonds; and WHEREAS, Park Nicollet Health Services, a Minnesota nonprofit corporation, Methodist Hospital, a Minnesota nonprofit corporation, Park Nicollet Institute, a Minnesota nonprofit corporation, Park Nicollet Clinic, a Minnesota nonprofit corporation, and PNMC Holdings, a Minnesota nonprofit corporation (collectively, the "Obligated Group"), have submitted an application to the City requesting the issuance by the City of revenue bonds pursuant to the Act (the "Bonds"), in the approximate aggregate pnncipal amount not to exceed $290,000,000, for the following purposes: (i) to finance (A) the construction and equipping of its Heart and Vascular Center at Methodist Hospital located at 6500 Excelsior Boulevard in the City of St. Louis Park, the construction of a parking ramp and other improvements at Methodist Hospital, the construction of public infrastructure improvements with respect to the foregoing, and -the acquisition and installation of equipment for Methodist Hospital, and (B) the acquisition and installation of (1) a computed tomography scanner ("CT Scanner") at the facilities of the Obligated Group located at 1400 Fairview Drive in the City of Burnsville, Minnesota, (2) a CT Scanner at the facilities of the Obligated Group located at 15800 95th Avenue North in the City of Maple Grove, Minnesota, and (3) a CT Scanner and a magnetic resonance imaging scanner ("MRI Scanner") at the facilities of the Obligated Group located at 250 North Central Avenue in the City of Wayzata, Minnesota (collectively, the "Project"); Resolution No. 03-117 -2- (ii) to redeem and prepay the outstanding pnncipal amount of (A) the Hospital Facilities Refunding Revenue Bonds (Methodist Hospital Project), Series 1990-B, issued by the City on November 15, 1990, (B) the Health Care Facilities Revenue Bonds (HealthSystem Minnesota Obligated Group), Series 1993A (Fixed Rate), issued by the City on September 30, 1993, (C) the Health Care Facilities Revenue Bonds (HealthSystem Minnesota Obligated Group), Series 1993B (Variable Auction Rate), issued by the City on September 30, 1993; and (D) the Health Care Facilities Revenue Bonds (HealthSystem Minnesota Obligated Group), Series 1993C (Inverse Vanable Auction Rate), issued by the City on September 30, 1993 (collectively, the "Prior Bonds"); and (iii) to fund a reserve fund to secure the payment of the principal of and interest on the Bonds and to finance the costs of issuing the Bonds; and WHEREAS, following the publication of a notice (the "Public Notice") of a public hearing (in which a general, functional descnption of the Project was provided, as well as the maximum aggregate face amount of the obligations to be issued for the purposes referenced above, the identity of the initial owner, operator, or manager of the facilities to be financed and refinanced with the proceeds of the Bonds, and the location of the facilities to be financed with the proceeds of the Bonds by street address) in a newspaper circulating generally in the City at least fourteen (14) days before the regularly -scheduled meeting of the City Council of the City on September 15, 2003, the City Council conducted a public hearing at which a reasonable opportunity was provided for interested individuals to express their views, both orally and in writing, on the Project, the redemption and prepayment of the Pnor Bonds, and the proposed issuance of the Bonds; and WHEREAS, the Bonds to be issued to refund the Prior Bonds will be issued under a Bond Trust Indenture, dated on or after September 1, 2003 (the "Bond Indenture"), between the City and Wells Fargo Bank Minnesota, National Association, as trustee (the "Bond Trustee"), and will be designated the Health Care Facilities Revenue Refunding Bonds (Park Nicollet Health Services), Senes 2003A, Periodic Auction Reset Secunties (PARS) (the "Refunding Bonds"), subject to such changes in such designation as elected by the Obligated Group with the consent of the City; and WHEREAS, the proceeds denved from the sale of the Refunding Bonds will be loaned to the Obligated Group pursuant to the terms of a Loan Agreement, dated on or after September 1, 2003 (the "Loan Agreement"), between the City and the Obligated Group, and will be applied, together with other available funds of the Obligated Group, to the redemption and prepayment of the Prior Bonds, the funding of a reserve fund to secure the Bonds, and the payment of certain expenses incurred in connection with the issuance of the Bonds; and WHEREAS, in consideration of the loan by the City of the proceeds of the Refunding Bonds to the Obligated Group and to secure the payment of the pnncipal of, premium, if any, and interest on the Refunding Bonds when due, the Obligated Group will issue a supplemental note (the "Supplemental Note") to the City pursuant to a Supplemental Indenture, dated on or after September 1, 2003 (the "Supplemental Indenture") to a Master Trust Indenture (the "Master Indenture"), between the Obligated Group and Wells Fargo Bank Minnesota, National Association, as master trustee (the "Master Trustee"), which will be in the same aggregate principal amount and bear interest at the same rates as the Refunding Bonds, will have redemption provisions corresponding to those of the Refunding Bonds, and will be payable in installments equal to the maturities and mandatory redemptions of the Refunding Bonds; and • Resolution No. 03-117 -3- WHEREAS, the loan repayments required to be made by the Obligated Group under the terms of the Loan Agreement will be assigned to the Bond Trustee under the terms of the Bond Indenture and the Supplemental Note will be assigned by the City to the Bond Trustee under the terms of the Bond Indenture; and WHEREAS, payment of the principal of and interest on all or a portion of the Bonds may be guaranteed by a financial guaranty insurance policy (the "Bond Insurance Policy") issued by Ambac Assurance Corporation, or another municipal bond insurance company selected by the Obligated Group with the consent of the City (the "Bond Insurer"), concurrently with the issuance of the Bonds; and WHEREAS, the Refunding Bonds and the interest and any premium on the Refunding Bonds: (i) shall be payable solely from the revenues pledged therefor; (ii) shall not constitute a debt of the City within the meaning of any constitutional or statutory limitation; (iii) shall not constitute nor give rise to a pecuniary liability of the City or a charge against its general credit or taxing powers; and (iv) shall not constitute a charge, hen, or encumbrance, legal or equitable, upon any property of the City other than the City's interest in the Loan Agreement; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ST. LOUIS PARK, MINNESOTA, AS FOLLOWS: 1. The City acknowledges, finds, determines, and declares that: (i) the issuance of the Refunding Bonds is authorized by the Act; (ii) the application of the proceeds of the Refunding Bonds to the redemption and prepayment of the Prior Bonds, the funding of a reserve fund to secure the Bonds, and the payment of certain expenses incurred in connection with the issuance of the Bonds is consistent with and furthers the purposes of the Act; and (ii) the facilities refinanced with the proceeds of the Refunding Bonds constitute a "project" within the meaning of Section 469.153, subdivision 2(b) and (d), of the Act. 2. For the purposes set forth above, there is hereby authonzed the issuance, sale and delivery of the Refunding Bonds in one or more series in the approximate aggregate principal amount of $205,000,000. The Refunding Bonds shall bear interest at variable rates established on such dates and in accordance with the terms of the Bond Indenture or may be issued, in whole or in part, or converted to Refunding Bonds that bear interest at fixed rates in accordance with the terms of the Bond Indenture. The Refunding Bonds shall be designated, shall be numbered, shall be dated, shall mature, shall be subject to redemption pnor to matunty, shall be in such form, and shall have such other terms, details, and provisions as are prescnbed in the Bond Indenture, in the form now on file with the City, with the amendments referenced herein. The City hereby authorizes the Refunding Bonds to be issued as "tax-exempt bonds" the interest on which is not includable in gross income for federal and State of Minnesota income tax purposes. All of the provisions of the Refunding Bonds, when executed as authonzed herein, shall be deemed to be a part of this resolution as fully and to the same extent as if incorporated verbatim herein and shall be in full force and effect from the date of execution and delivery thereof. The Refunding Bonds shall be substantially in the form or forms set forth in the Bond Indenture, which form or forms are hereby approved, with such necessary and appropriate variations, omissions and insertions (including changes to the name of the Refunding Bonds, the aggregate principal amount of the Refunding Bonds, the stated matunties of the Refunding Bonds and the maturity dates of the Refunding Bonds, the initial interest rates on the Refunding Resolution No. 03-117 -4- Bonds and the terms for determining the vanable rates or the fixed rates on the Refunding Bonds, and the terms of optional and mandatory redemption of the Refunding Bonds) as the Mayor of the City and the City Manager of the City (the "Mayor" and "City Manager"), in their discretion, shall determine. The execution of the Refunding Bonds with the manual or facsimile signatures of the Mayor and the City Manager and the delivery of the Refunding Bonds by the City shall be conclusive evidence of such determination. 3. The Refunding Bonds shall be special limited obligations of the City the proceeds of which shall be disbursed pursuant to the terms of the Bond Indenture and the Loan Agreement, and the principal, premium, and interest on the Refunding Bonds shall be payable solely from the proceeds of the Bonds, the revenues denved from the Obligated Group pursuant to the terms of the Loan Agreement and the Supplemental Note, and other funds pledged pursuant to the Bond Indenture. The Refunding Bonds shall also be secured by the Reserve Fund established by the terms of the Bond Indenture and funded with a portion of the proceeds of the Bonds (the "Reserve Fund"). The Refunding Bonds may also be secured by the Bond Insurer pursuant to the terms of the Bond Insurance Policy. 4. The City Council of the City hereby authonzes and directs the Mayor and the City Manager to execute and deliver the Bond Indenture, and to deliver to the Bond Trustee the Bond Indenture, and hereby authonzes and directs the execution of the Refunding Bonds in accordance with the terms of the Bond Indenture, and hereby provides that the Bond Indenture shall provide the terms and conditions, covenants, rights, obligations, duties and agreements of the owners of the Refunding Bonds, the City and the Bond Trustee as set forth therein. All of the provisions of the Bond Indenture, when executed as authonzed herein, shall be deemed to be a part of this resolution as fully and to the same extent as if incorporated verbatim herein and shall be in full force and effect from the date of execution and delivery thereof. The Bond Indenture shall be substantially in the form on file with the City, which is hereby approved, with such necessary and appropriate variations, omissions and insertions as do not matenally change the substance thereof, or as the Mayor and the City Manager, in their discretion, shall determine, and the execution and delivery thereof by the Mayor and the City Manager shall be conclusive evidence of such determination. 5. The Mayor and City Manager are hereby authorized and directed to execute and deliver the Loan Agreement and the Bond Purchase Agreement, dated on or after September 15, 2003 (the "Bond Purchase Agreement"), between Goldman, Sachs & Co. (the "Underwnter"), the City, and the Obligated Group. All of the provisions of the Loan Agreement and the Bond Purchase Agreement, when executed and delivered as authonzed herein, shall be deemed to be a part of this resolution as fully and to the same extent as if incorporated verbatim herein and shall be in full force and effect from the date of execution and delivery thereof. The Loan Agreement and the Bond Purchase Agreement shall be substantially in the forms on file with the City which are hereby approved, with such omissions and insertions as do not matenally change the substance thereof, or as the Mayor and the City Manager, in their discretion, shall determine, and the execution thereof by the Mayor and the City Manager shall be conclusive evidence of such determination. 6. The Bond Trustee is hereby appointed as the initial Paying Agent, Bond Registrar, and Tender Agent with respect to the Refunding Bonds. Resolution No. 03-117 -5- 7. In order to provide for the determination of the variable interest rates on the Refunding Bonds, the Bond Trustee is hereby authonzed to enter into an Auction Agreement, dated on or after September 1, 2003 (the "Auction Agreement"), between the Trustee and Wilmington Trust Company (or another financial institution selected by the Obligated Group with the consent of the City), as auction agent (the "Auction Agent"). The Bond Trustee is also authorized to take such other actions as are required by the terms of the Bond Indenture to provide for the determination of the variable rates on the Refunding Bonds and to give effect to the auction procedures set forth in the Bond Indenture. In order to give effect to the auction procedures set forth in the Bond Indenture, the City hereby approves the execution and delivery of the Broker -Dealer Agreement, dated on or after September 1, 2003 (the "Broker -Dealer Agreement"), between the Auction Agent, the Underwriter, and the Obligated Group. The Auction Agreement and the Broker -Dealer Agreement shall be substantially in the forms on file with the City which are hereby approved, with such omissions and insertions as are agreed to by the parties thereto. 8. The Mayor and City Manager of the City are hereby authorized to execute and deliver, on behalf of the City, such other documents as are necessary or appropnate in connection with the issuance, sale, and delivery of the Refunding Bonds, including a Tax Certificate, a Tax Exemption Agreement, an Information Return for Tax -Exempt Private Activity Bond Issues, Form 8038, and all other documents and certificates as shall be necessary and appropnate in connection with the issuance, sale, and delivery of the Refunding Bonds. The City hereby approves the execution and delivery by the Bond Trustee of the Bond Indenture and all other instruments, certificates, and documents prepared in conjunction with the issuance of the Refunding Bonds that require execution by the Bond Trustee. The City hereby authorizes Kennedy & Graven, Chartered, as bond counsel of the City, to prepare, execute, and deliver its approving legal opinion with respect to the Refunding Bonds. 9. The City has not participated in the preparation of the Official Statement relating to the offer and sale of the Refunding Bonds (the "Official Statement"), and has made no independent investigation with respect to the information contained therein, including the appendices thereto, and the City assumes no responsibility for the sufficiency, accuracy, or completeness of such information. Subject to the foregoing, the City hereby consents to the distribution and the use by the Underwriter in connection with the sale of the Refunding Bonds of the Official Statement. The Official Statement is the sole material consented to by the City for use in connection with the offer and sale of the Refunding Bonds. The City hereby approves the Continuing Disclosure Agreement, dated on or after September 1, 2003 (the "Continuing Disclosure Agreement"), to be executed and delivered by the Obligated Group and the Bond Trustee, in the form now on file with the City. 10. Except as otherwise provided in this resolution, all rights, powers and privileges conferred and duties and liabilities imposed upon the City or the City Council by the provisions of this resolution or of the aforementioned documents shall be exercised or performed by the City or by such members of the City Council, or such officers, board, body or agency thereof as may be required or authonzed by law to exercise such powers and to perform such duties. No covenant, stipulation, obligation or agreement herein contained or contained in the aforementioned documents shall be deemed to be a covenant, stipulation, obligation or agreement of any member of the City Council of the City, or any officer, agent or employee of the City in that person's individual capacity, and neither the City Council of the City nor any Resolution No. 03-117 -6- officer or employee executing the Refunding Bonds shall be liable personally on the Refunding Bonds or be subject to any personal liability or accountability by reason of the issuance thereof. No provision, covenant or agreement contained in the aforementioned documents, the Refunding Bonds or in any other document relating to the Refunding Bonds, and no obligation therein or herein imposed upon the City or the breach thereof, shall constitute or give rise to any pecuniary liability of the City or any charge upon its general credit or taxing powers. In making the agreements, provisions, covenants and representations set forth in such documents, the City has not obligated itself to pay or remit any funds or revenues, other than funds and revenues derived from the Loan Agreement and the Supplemental Note which are to be applied to the payment of the Refunding Bonds, as provided therein and in the Bond Indenture. 11. Except as herein otherwise expressly provided, nothing in this resolution or in the aforementioned documents expressed or implied, is intended or shall be construed to confer upon any person or firm or corporation, other than the City or any holder of the Refunding Bonds issued under the provisions of this resolution, any right, remedy or claim, legal or equitable, under and by reason of this resolution or any provisions hereof, this resolution, the aforementioned documents and all of their provisions being intended to be and being for the sole and exclusive benefit of the City and any holder from time to time of the Refunding Bonds issued under the provisions of this resolution. 12. In case any one or more of the provisions of this resolution, other than the provisions contained in the first sentence of Section 3 hereof, or of the aforementioned documents, or of the Refunding Bonds issued hereunder shall for any reason be held to be illegal or invalid, such illegality or invalidity shall not affect any other provision of this resolution, or of the aforementioned documents, or of the Refunding Bonds, but this resolution, the aforementioned documents, and the Refunding Bonds shall be construed and endorsed as if such illegal or invalid provisions had not been contained therein. 13. The Refunding Bonds, when executed and delivered, shall contain a recital that they are issued pursuant to the Act, and such recital shall be conclusive evidence of the validity of the Refunding Bonds and the regularity of the issuance thereof, and that all acts, conditions, and things required by the laws of the State of Minnesota relating to the adoption of this resolution, to the issuance of the Refunding Bonds, and to the execution of the aforementioned documents to happen, exist and be performed precedent to the execution of the aforementioned documents have happened, exist and have been performed as so required by law. 14. The officers of the City, bond counsel, other attorneys, engineers, and other agents or employees of the City are hereby authorized to do all acts and things required of them by or in connection with this resolution, the aforementioned documents, and the Refunding Bonds for the full, punctual and complete performance of all the terms, covenants and agreements contained in the Refunding Bonds, the aforementioned documents and this resolution. In the event that for any reason the Mayor of the City is unable to carry out the execution of any of the documents or other acts provided herein, any persons delegated the duties of the Mayor shall be authorized to act in the capacity of the Mayor and undertake such execution or acts on behalf of the City with full force and effect, which execution or acts shall be valid and binding on the City. If for any reason the City Manager of the City is unable to execute and deliver the documents referred to in this Resolution, such documents may be executed by any person delegated the duties of the City Manager, with the same force and effect as if such documents were executed and delivered by the City Manager of the City. Resolution No. 03-117 -7- 15. The City understands that the Obligated Group will pay directly or through the City any and all costs paid or incurred by the City in connection with the transactions authorized by this resolution, whether or not the Refunding Bonds are issued. 16. The City acknowledges that the Obligated Group is proposing to enter into an interest rate swap agreement with respect to the Bonds. The City hereby authorizes such interest rate swap agreement with the understanding that the interest rate swap agreement does not affect or alter the obligations of the Obligated Group pursuant to the Loan Agreement or the Supplemental Note and with the further understanding that neither the City nor the owners of the Refunding Bonds shall have any nghts or obligations under the interest rate swap agreement. 17. This resolution shall be in full force and effect from and after its passage. Adopted by the City Council of the City of St. Louis Park, Minnesota, this September 15, 2003. Reviewed for Administration: Attest: 3/,7c7eic Adopted by the City Council September 15, 2003